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The information provided on EL7.AI is for educational and informational purposes only and does not constitute financial advice.
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Sign InA coalition of major DeFi protocols, including Aave Labs and KelpDAO, has escalated recovery efforts via a Constitutional AIP on Arbitrum to release 30,765 frozen ETH following the KelpDAO exploit. New data reveals that Aave protocol's bad debt losses have reached $196 million as a direct result of the incident, intensifying the urgency for recovery. Procedural concerns persist as the 49-day AIP lifecycle is viewed as too lengthy by delegates facing systemic risks, including a $260 million debt position at MEXC. This formal petition aims to restore ecosystem stability and prevent further bad debt accumulation across interconnected protocols. Furthermore, the industry anticipates increased regulatory scrutiny on DeFi protocols following the scale of this exploit. Analysts remain focused on the Arbitrum DAO's response as a critical measure to mitigate broader liquidation risks.